Section 75-02-09-01 - [Effective 1/1/2025] Definitions1. "Accrual basis" means the recording of revenue in the period when it is earned, regardless of when it is collected, and the recording of expenses in the period when incurred, regardless of when they are paid.2. "Adjustment factor" means the legislatively approved inflation rate for psychiatric residential treatment facilities services.3. "Allowable cost" means the facility's actual and reasonable cost after adjustments required by department rules.4. "Capital asset" means a facility's buildings, land improvements, fixed equipment, movable equipment, leasehold improvements, and all additions to or replacements of those assets used directly for resident care.5. "Chain organization" means a group of two or more health care facilities owned, leased, or, through any other device, controlled by one business entity. The term includes not only proprietary chains, but also chains operated by various religious and other charitable organizations, and business organizations engaged in other activities not directly related to health care.6. "Cost category" means the classification or grouping of similar or related costs for purposes of reporting which are used in the determination of cost limitations and rates.7. "Cost report" means the department-approved form for reporting costs, statistical data, and other relevant information to the department.8. "Department" means the department of health and human services.9. "Depreciation" means an allocation of the cost of an asset over its estimated useful life.10. "Depreciation guidelines" means the American hospital association's depreciation guidelines as published by American hospital publishing, inc., in "Estimated Useful Lives of Depreciable Hospital Assets", revised 2021 edition.11. "Desk rate" means the rate established by the department based upon a review of the cost report submission prior to an audit of the cost report.12. "Direct costing" means identification of actual costs directly to a facility or cost category without use of any means of allocation.13. "Education" means the cost of activities related to academic and vocational training generally provided by a school district.14. "Facility" means an entity that is a licensed psychiatric residential treatment facility for children under chapter 75-03-17.15. "Fair market value" means value at which an asset could be sold in the open market in a transaction between informed, unrelated parties.16. "Final rate" means the rate established after any adjustments by the department, including adjustments resulting from cost report reviews and audits.17. "Fringe benefits" means workers' compensation insurance, group health, dental or vision insurance, group life insurance, payment toward retirement plans, uniform allowances, employer's share of Federal Insurance Contributions Act, unemployment compensation taxes, and medical services furnished at facility expense.18. "Generally accepted accounting principles" means the accounting principles approved by the American institute of certified public accountants.19. "Historical costs" means the allowable costs incurred by the facility during the report year immediately preceding the rate year for which the established rate becomes effective.20. "Hospital leave day" means any day a resident is not in the facility, but is in an acute care or psychiatric hospital setting and admitted as an inpatient.21. "In-house day" means a day that an individual was actually residing in the facility and was not on leave.22. "Interest" means cost incurred for the use of borrowed funds.23. "Leave day" means any day that an individual is not in the facility but is expected to return to the facility.24. "Private-pay resident" means an individual on whose behalf the facility is not receiving medical assistance payments.25. "Rate year" means the calendar year from January first through December thirty-first.26. "Reasonable cost" means the cost that must be incurred by an efficiently and economically operated facility to provide services in conformity with applicable state and federal laws, rules, and quality and safety standards. Reasonable cost takes into account that the facility seeks to minimize its costs and that its actual costs do not exceed what a prudent and cost-conscious buyer pays for a given item or service.27. "Related organization" means an organization that a facility is, to a significant extent, associated with, affiliated with, able to control, or controlled by; and which furnishes services, facilities, or supplies to the facility. Control exists when an individual or organization has the power, directly or indirectly, to significantly influence or direct the policies of an organization or facility.28. "Report year" means the fiscal year from July first through June thirtieth of the year immediately preceding the rate year.29. "Resident day" means a day for which service is actually provided or for which payment is ordinarily sought.30. "Special rate" means a desk rate or a final rate adjusted for nonrecurring or initial costs not included in the historical cost basis.31. "Working capital debt" means debt incurred to finance facility operating costs, but does not include debt incurred to acquire or refinance a capital asset or to refund or refinance debt associated with acquiring a capital asset.N.D. Admin Code 75-02-09-01
Effective May 1, 1994; amended effective October 1, 2011.Amended by Administrative Rules Supplement 2024-395, January 2025, effective 1/1/2025.General Authority: NDCC 50-24.1-04
Law Implemented:42 USC 1396a(a)(30)(A)